No, they don’t. Not the $13 billion that was funneled through AIG. That money is free and clear.

Further, you conflate two different forms of welfare we are giving these insitutions — preferred shares and common shares. Preferred shares receive interest payments and are safer, while common shares never have to be paid back, receive no interest payments, make money only if we continue to subsidize these institutions to the point they are profitable again, and are the first to be wiped out in bankruptcy. [1]

The federal government, states, counties, and cities are all spending money on mass transit. I doubt our total spending is not fully comparable.

In a world where economics holds no sway, bailouts are free, and investing any amount is always investing the appropriate amount, you would have a point here. However, we don’t, and you don’t.

The federal government have decided run up gigantic budget deficits to not invest in infrastructure, but to guarantee the people that Geithner has known for years remain protected from the risks bets they placed.

The fact remains, the 13 billion is a debt owed to the taxpayer by AIG, not Goldman Sachs. If they had decided to allow AIG to fail, and still have done TARP for the others, then Goldman Sachs would have gotten 13 billion more.

I read websites and other media that call it a backdoor TARP payment, and these people are just fruit loopy Goldman Sachs haters.

In my understanding of TARP, should a recipient be unable to pay back their TARP loan, then the financial industry had to promise to make up that shortfall. In other words, the industry guaranteed the repayment of all 700 billion. They had to guarantee that TARP could not ultimately increase the national debt. I was never able to learn exactly what they meant by the “financial industry”, but whatever that is, they have guaranteed all the TARP will be repaid. If AIG ends up owing back 13 billion, then Goldman Sachs would have to throw in some of its cash to make up the 13 billion shortfall to the taxpayers.

In my understanding of TARP, should a recipient be unable to pay back their TARP loan, then the financial industry had to promise to make up that shortfall

So what you are saying is that after the Government launders money through AIG to favored institutions, those institutions might eventually have to kick back at something like ten cents on the dollar for what they received?